European EPS prices rose by EUR30-40/tonne for CIS markets

MOSCOW (MRC) -- January prices of expandable polystyrene (EPS) in Europe grew by EUR30-40/tonne for all buyers in the CIS countries, according to ICIS-MRC Price report.

The reason for higher European EPS prices was an increase in the production cost of the polymer in January, which is directly connected with styrene monomer (SM) prices. The contract SM price for January shipments rose by EUR35/tonne and was EUR1,410/tonne.

Thus, January EPS purchase prices of the Polish producer Synthos (Dwory) for customers in the CIS countries increased by EUR35/tonne from December.

As reported previously, SIBUR reduced export EPS prices for January shipments by USD50/tonne on the back of seasonal weakening in consumer activity.
MRC

MOSCOW (MRC) -- Ming Dih Group is in plans to shut an expandable polystyrene (EPS) plant during the Chinese Lunar New Year holidays, said Apic-Online.

A source in Taiwan informed that the plant is likely to be shut in late January, 2014. The plant is expected to remain off-stream for around one week.

As MRC informed before, Ming Dih Group plans to expand its expandable polystyrene (EPS) plant in Bangkok, Thailand, in the third quarter of 2014. The expansion next year will lift the plant’s capacity by 10,000 tonnes/year to 50,000 tonnes/year.

Ming Dih operates a 180,000 tonne/year unit in Taiwan, a 100,000 tonne/year unit in China and a 40,000 tonne/year unit in Thailand.
MRC

MOSCOW (MRC) -- ExxonMobil officially launched the world's first chemical unit that processes crude oil in Singapore, aiming to lower costs to better compete with rivals in a market saddled with excess capacity, said Reuters.

Chemical companies typically process refined oil products such as naphtha - created by separating crude oil into lighter groups - at facilites called crackers to create petrochemicals like ethylene and propylene. These are further processed into products such as plastics, soaps or synthetic fibres.

But Exxon's new cracker in Singapore allows the company to bypass the refining process by processing crude directly into petrochemicals. The new technology helps reduce raw material costs, energy consumption and carbon emissions, Pryor said, while the cracker also produces fuel components.

Crackers in Asia typically use naphtha as a feedstock, while those in the Middle East enjoy a cost advantage as they process cheaper ethane and propane gases into petrochemicals. The multi-billion dollar complex on Singapore's Jurong Island includes the 1 million tonne per year (tpy) steam cracker as well as production of at least 1.4 million tpy of polymers and elastomers. The cracker was brought online in the middle of last year, but Exxon has not previously confirmed the use of crude as a feedstock.

The project had been delayed for two years due to its complexity and a weak economic outlook which has pared the use of petrochemicals in automobile parts, electrical applicances and consumables, despite excess capacity.

An improved economic outlook in the United States and better demand in China is expected to raise global chemical demand growth in coming years, according to the American Chemistry Council. The Council sees headline global petrochemicals growth of 4.1% in 2014 and 4.5% in 2015, up from 2.1% last year, said Thomas Kevin Swift, its chief economist and managing director.

To meet this demand, Exxon also planned to raise ethylene capacity at its joint venture with Saudi Aramco and Sinopec in southern China Fujian by 200,000 tonnes per year in 2015. At the Singapore plant, Exxon could also produce specialty petrochemicals such as butyl rubber for tyres and premium resins for adhesives, Pryor said.

Yet, supply from the United States could jump as petrochemical producers, including Exxon, launch projects to take advantage of cheap ethane gas from the shale resources boom. Exxon plans to build a 1.5 million tpy ethylene complex at Baytown, Texas by 2016.

French oil major Total and Ineos have said they will shut loss-making petrochemical plants in France and Scotland as Europe readies for a competitive assault from U.S. rivals armed with cheap feedstock. (Reporting by Florence Tan and Seng Li Peng; Editing by Richard Pullin)
MRC

MOSCOW (MRC) -- Vitol Group, the world’s largest independent oil trader, is considering a bid for some of Royal Dutch Shell's Australian downstream operations, according to Hydrocarbonprocessing.

Shell, Europe’s biggest oil company, is stepping up asset sales after spending a record USD45 billion on projects and acquisitions last year. Its earnings from refining and marketing dropped by almost half to USD892 million in the three months to September.

The Hague-based company’s Australian unit said in April it would sell the Geelong refinery to focus on larger plants, such as the Pulau Bukom refinery in Singapore. The Geelong facility, which processes about 120,000 bpd of oil, may be converted to a fuel import terminal if a sale isn’t completed, according to its website.

Shell also has a network of about 900 filling stations in Australia, two-thirds of which are operated by its retail partner Coles Group Ltd., owned by Wesfarmers Ltd. Spokesmen for Shell, Vitol, Macquarie and TPG declined to comment. Shell plans to sell about AD3 billion (USD2.7 billion) of Australian assets and is talking to parties including TPG and a group that includes Macquarie, the Australian Financial Review reported today, citing unidentified people.

Vitol agreed in 2011 to buy the bulk of Shell’s downstream business in 14 African countries, alongside Africa-focused private equity firm Helios Investment Partners, for about USD1 billion. The Swiss company owns and operates refineries in the United Arab Emirates, Switzerland and the Netherlands with a refining capacity of about 150,000 bpd, according to its website. It also has a storage terminal venture with facilities in 14 countries.

Australia’s Macquarie Capital agreed in August to buy 45% of Singapore’s Helios Terminal Corp. from Oiltanking for an undisclosed sum, the closely-held German company said Aug. 12. Oiltanking bought the terminal on Jurong Island, which comprises 18 storage tanks, from Chemoil Energy for USD285 million a year ago.

As MRC wrote before, Ukraine took its first major step away from dependency on Russian gas imports on Thursday when it signed a USD10 billion shale gas deal with Shell. The 50-year production sharing agreement, signed on the sidelines of the World Economic Forum in Davos, marks the biggest contract yet to tap shale gas in Europe and the largest foreign investment in the former Soviet republic.
MRC

MOSCOW (MRC) -- Dutch painting and chemicals company Akzo Nobel NV said Wednesday that trading into the fourth quarter of 2013 was in line with previous trends, and the economic environment continued to be challenging, said Marketwatch.

As previously indicated, AkzoNobel's full year 2013 operating income before incidental items is unlikely to exceed EUR908 million.

The Performance Improvement Program is on track to achieve its 2013 targets. Restructuring charges are expected to exceed EUR300 million, largely in line with prior indications for 2013. For 2014, we see continued opportunities to invest in additional efficiency gains and now anticipate charging at least EUR250 million in the year.

During the fourth quarter, the sale of the Building Adhesives business was successfully completed, which will result in an incidental profit of around EUR200 million. This is expected to be largely offset by additional incidental charges, including a non-cash write-down in Specialty Chemicals, among others.

Further details will be included in the 2013 results, which remain subject to final closing and audit review. The Q4 2013 results will be announced on 6th February 2014, and a Capital Markets Day will be held in London on March 11, 2014.

Trading into the fourth quarter of 2013 has continued to be in line with previous trends, and the economic environment continued to be challenging. As previously indicated, AkzoNobel’s full year 2013 operating income before incidental items is unlikely to exceed EUR908 million.

During the fourth quarter, the sale of the Building Adhesives business was successfully completed, which will result in an incidental profit of around EUR200 million. This is expected to be largely offset by additional incidental charges, including a non-cash write-down in Specialty Chemicals, among others.

As MRC wrote before, AkzoNobel completed the sale of its Primary Amides chemicals business to PMC Group effective December 31, 2013. Under the terms of the agreement, a manufacturing facility in Kyungju, South Korea, and all 37 employees will transfer to PMC Group with immediate effect, along with the erucamide, oleamide and other primary and secondary amides sold under the Armoslip trade names.

Akzo Nobel N.V., trading as AkzoNobel, is a Dutch multinational, active in the fields of decorative paints, performance coatings and specialty chemicals. Headquartered in Amsterdam, the company has activities in more than 80 countries, and employs approximately 55,000 people.
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